Microsoft previews new Windows Live and Office Live services

Microsoft unveiled a new group of web-based software services designed to …

Today Microsoft formally announced a set of new software services under the names Windows Live and Office Live. The services are designed to complement, rather than replace, Microsoft's venerable Windows and Office software franchises.

Windows Live currently consists of a new replacement for Hotmail, a "Safety Center" that works as an online anti-virus checkup, and a browser-based access page for your local Internet Explorer Favorites. In beta and coming soon are a new version of MSN Messenger, a Live version of OneCare that combines virus scanning, system tuneups and backup, and a new Windows Live Search that combines features of MSN Search and MSN Maps and formats them for display on a SmartPhone or other mobile device.

Office Live is being launched as an invitation-only beta program for small businesses. It consists of a domain name and email hosting package that includes a private corporate web site and numerous tools for customer relations management (CRM), document management, and project collaboration.

The new services do not replace existing websites such as msn.com, but are part of a larger project to deliver web-based services to existing Windows and Office customers. Windows Live will be primarily supported by web advertising. Office Live is expected to have both advertising-supported and paid subscription versions without the ads.

The services follow the Google model, where beta versions will be made available to the public, software updates will be frequent and delivered directly over the web, without the need for customers to download any software. Bill Gates espoused the benefits of this approach:

We are embarking on the richest series of product releases in our company?s 30-year history. Beyond the opportunities this presents for our customers and partners, these new live offerings represent an incredibly powerful way of enabling customers to more quickly access and benefit from the innovations being developed by our product teams.

The use of the "Live" moniker invites comparisons to Microsoft's XBox Live! game matchmaking and voice chat service. This is almost certainly not coincidental. Microsoft's goal in the future will likely involve more integration between the Windows PC and the Xbox game platform, to leverage existing communities on both. The use of free, advertising-supported web services seems at first like a reaction to Google's success, but Microsoft has been thinking about ways to increase regular revenue from software for a long time. Subscription-based software and Software Assurance programs generated primarily negative reactions from customers, but they were all about moving income from one-time retail software purchases to a regular stream of subscriptions. Can Windows Live and Office Live succeed where these efforts have failed?